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By Miriam Raftery

February 23, 2009 (Sacramento)--Ending months of deadlock, the California Legislature has approved a compromise budget which Governor Schwarzenegger has signed. The budget includes $12.8 billion in tax increases and $15.1 billion in spending cuts, including deep cuts to education funding and social services. But the Los Angeles Times reported, “California remains in a precarious financial situation. If, by April, the state does not secure about $2 billion more in federal aid than it now expects to receive, deeper cuts will automatically kick in because of provisions in the budget.” Those cuts would include 4% reductions in welfare grants, 2.3% cuts to the blind and disabled, wage caps for in-home aides to the ill and reductions for colleges and universities.

The Governor also issued line item vetoes, blocking $400 million funding for prisons despite a court order to release some prisoners because of overcrowding. The move will force early releases, putting added pressures on probation officers already struggling to supervise parolees in the wake of deep budget cuts. Schwarzenegger also cut funds for state office holders, slashing by 62% the budget for Lieutenant Governor John Garamendi, a Democrat who has announced plans to run against Schwarzenegger for Governor in 2010.

Passage of the budget will help stem the state’s $42 billion deficit and assure that funding will not be cut off as threatened for county programs, such as payments to foster parents. The budget crisis had forced a halt to all road construction projects and led the Governor to furlough and lay-off thousands of state workers. The compromise budget measure includes putting three initiative proposals on the ballot, allowing voters to decide whether California should have a cap on state spending, open primaries, or a freeze on legislative pay raises during deficit years.

"We don't know when revenue is going to stabilize," said Assembly Speaker Karen Bass (D-Los Angeles), noting the severe economic downturn.

The California Republican Party has reprimanded six GOP legislators who voted in favor of the budget despite agreeing to a “no new taxes” pledge. The six will be denied party funding in their upcoming reelection bids. (Details: http://www3.signonsandiego.com/stories/2009/feb/22/ca-gop-convention-022...). Legislators representing East County split down party lines, with all local Republicans voting against the budget and all local Democrats voting in favor.